Saturday, February 25, 2006

Daytrading

Some times I do a daytrade for fun. Today I traded Google. Bought 70 shares alongside the 30 I already had and then at the end of the day I sold 80 for a small profit. There were a couple of opportunities during the day to make a few hundreds of profit and I missed them :( Oh well, at least I ended up by a few tens of dollars...

The money for the trade was borrowed on margin using "day-trading buying power". This means you have to close the trade by the end of the day or get a margin call... so it really is pretty much educated gambling on how fast the stock will move in the direction you expect.

Friday, February 24, 2006

Americans' Net Worth Trends

This article shows just how unusual most of the posters on NetWorthIQ who have multiple entries are:

http://money.cnn.com/2006/02/23/pf/consumer_fedsurvey/index.htm

Most show strongly rising net worth. However the median of all posters at $79500 is not that far from the national median of $93000. It is pretty obvious that people making an effort to increase their net worth are the types to track their progress on such a website...

Goals

The net worth goals might seem rather high and they do depend on everything going right.

The goal for this year is based on:

Current savings from salary: $20,000
Retirement contributions: $7,000
Investment returns: $30,000
Inheritance: $20,000 ($7,000 of which has materialized the other is a guess of the value of my share of a land sale)
Exchange rate change: $23,000

I'd be happy with a lot less - say a $50,000 gain instead of the $100,000 gain. But with $16,000 added to net worth so far this year I am right on track for the $100,000 goal.

The decade-end goal is dependent on there being a new stock bull market in 2007-8. This is what I expect based on the four year stock cycle. Based on the 2002-5 bull market I could double whatever wealth I have at the beginning of such a bull market. If that happens, the $1 million goal will not be so hard to achieve.

At the moment I am mainly trying to preserve capital against a potential downturn this year. You have to be very daring and right to make money in a down market...

Trading

Difficult trading environment at the moment. My trading positions are pretty much hedged between long and short at this point. Last night took a hit on my News Corp puts... this morning news from Toll Brothers is good as I am long WLS (William Lyon Homes). Nursing a long Blackrock (after trading it both ways last week). Was expecting a bounce on technicals.... Short SBUX very bad.... Long AAPL, HHH, and GOOG doing great. This morning AAPL announced new product announcements coming on Feb 28. Short DCX has been bad up till the last few days when plenty of analysts downgraded the stock...

On the investment side my current positions are pretty conservative with a bias towards bond mutual funds and listed hedge fund type investments. More on all this at month end.

PS 3pm - bought an extra 100 shares of AAPL

Thursday, February 23, 2006

This and that

A great blog on the world markets, investment strategy, and China, from one of my old friends at Silicon Investor:

http://worldmarket.blogspot.com/

The Australian Dollar has been going down and foreign currency has a big impact on my net worth calculation. This month so far I am down $US 1,000 but up approximately $A 9,000...

Thursday, February 16, 2006

Long Term Net Worth


This chart shows my net worth in the 12 years or so before NetWorthIQ's accounting starts. Starts with a period as a grad student and post doc where I go into and then out of debt and then a gradual increase in the last ten years. Big dip in 2002 due to no employment, a crashing stockmarket and a worldwide job search. Flew more miles that year including two round the world trips in the first three months of the year than I did before or since... Rate of accumulation since moving to the US (in 2002) has been faster than in Australia (1996-2002) where I earned less.

Welcome

This is my blog - I just got it so I can answer other blogs - I will probably occasionally post some personal finance stuff here to complement my profile on NetWorthIQ.